IRA Rollover of Gold Coins
A client who is over 59 1/2 has gold coins inside of his IRA. He would like to take out the gold coins to own personally, and replace the coins with cash. His her permitted to distribute the gold coins, and let’s assume they are valued at $20,000, and then rollover $20,000 of CASH back into his IRA within the 60 day rollover period? Basically, the client just wants to own the gold personally and replace the value of the gold coins with cash.
Thank you!!
Permalink Submitted by Alan - IRA critic on Mon, 2014-11-24 16:15
This cannot be done. See p 25 of Pub 590, “the same property must be rolled over”. He can only complete the rollover by rolling the coins back into an IRA, not cash.
Permalink Submitted by [email protected] on Tue, 2014-11-25 17:37
I would assume this would be in a self directed IRA? Could he not sell the gold coins within the IRA for cash? If so, could he not buy them himself? – m
Permalink Submitted by Alan - IRA critic on Tue, 2014-11-25 19:42
Could not personally buy or sell between his IRA and himself – prohibited transaction of self dealing. However, he can distribute from the IRA to himself, but not roll distributed property back unless it is the same property.
Permalink Submitted by [email protected] on Tue, 2014-11-25 21:40
Yes, thanks. But he could sell them in the IRA, generating the cash in the IRA. He could then take the cash that he has outside the IRA (that he would otherwise roll back to his IRA in his example) and use it to buy the gold coins outside of his IRA. Two separate transactions with exactly the same desired result. Unless I’m missing something.
Permalink Submitted by Alan - IRA critic on Wed, 2014-11-26 00:12
He could buy gold coins in that manner, but don’t know how he would re acquire those specific coins which were sold to an unrelated buyer with the IRA sale. But he certainly could acquire something close.